GM also raised its 2016 earnings per share forecast to $5.25 and $5.75 per share from a previous 2016 outlook made in October of between $5.00 and $5.50 per share.

GM executives outlined a plan to give back to shareholders a total of $16 billion for the period from 2015 through 2017. In March 2015, GM agreed to return a total of $10 billion in share repurchases and increased dividends through the end of 2016.

Investors appeared to cheer GM's plans in premarket trading, boosting shares by 4.6 percent to $31.70 per share in the minutes after the company's announcement.

By contrast, investors sold Ford Motor Co. stock Tuesday evening after the Dearborn, Michigan, automaker said it would pay a special dividend of $1 billion, but cautioned that margins in its North American auto market could hit a plateau at about 9.5 percent.

Ford shares were down about 1 percent in premarket trading, at $12.71.

Taken together, the back-to-back presentations by the two automakers at a conference on the sidelines of the Detroit auto show set up a referendum for investors on which of the two U.S. automakers has the better strategy to weather a cyclical downshift in vehicle sales growth, increasing costs to meet regulatory demands and technology-driven challenges from self-driving vehicles and car sharing.

If GM carries out its latest plan, the once-bankrupt auto major will have returned to shareholders about $23 billion between 2012 and the end of 2017, or about 90 percent of free cash flow, Chief Financial Officer Chuck Stevens said.

As it gives more cash back to investors, GM President Dan Ammann said the company plans to reduce capital spending as a share of revenue below the current 5 percent to 5.5 percent late in this decade.

However, Chief Executive Officer Mary Barra and Ammann said the cuts will not compromise GM's core vehicle business or investments in new ventures such as car sharing or self-driving vehicles.

Ammann said once GM finishes overhauling its vehicle and engine architectures over the next several years, the automaker can develop more new models for less money.

Barra also sought to reassure investors who are worried about the impact from the economic turbulence in China, the automaker's biggest market.

"We still are very strong on China," Barra said. Long term, she said the Chinese auto market could grow to 35 million vehicles from about 25 million currently. "It's going to be very volatile," she said.